A Build-Up Leveraged Buyout Involves

question 26

Multiple Choice

A build-up leveraged buyout involves

• A) developing the business to make it an attractive takeover target.
• B) acquiring businesses that occupy a higher level in the market channel.
• C) a longer time horizon than a bust-up leveraged buyout.
• D) constructing a larger enterprise to be taken public via an IPO.

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Definitions:

Effective Interest

The real cost of borrowing or the actual interest rate earned, considering compounding and fees.

Amortize Discount

The gradual reduction of a bond discount over the life of the bond, expensed as interest over the period.

Straight-Line Method

The Straight-Line Method is a way of calculating depreciation of an asset, where the asset's cost is evenly spread over its useful life.

Other Than Temporary

Classification of impairments or losses indicating that the reduction in value is not expected to reverse in the near future.